At Dot Dot Dot, our purpose is to provide well-managed, inexpensive homes to people who want to volunteer for good causes. So setting the prices our residents pay for their housing is crucial to our social impact model as well as our business model, and we think about it carefully.
Our fees are set at between 50% and 66% of local market rents. They range from £325 to £895 per month, with our higher fees being charged to people living alone in houses and flats with several bedrooms in inner London. Many of our fees include utilities and Council Tax.
In setting these prices, we take three things into account. First, we make sure that the housing we provide is great value. Second, we ensure business sustainability. Finally, we seek to keep prices fair across our portfolio.
Providing inexpensive housing in a housing crisis
We aim to offer housing that costs less than 66% of local market rents. In setting our prices, we research local markets by looking at what is offered by estate agents and house-sharing websites such as SpareRoom and Gumtree. We also make sure we’re comparing like with like, measuring our pricing against other similar local buildings, not against different kinds of housing altogether.
Because property guardians are licensees not tenants, they have less security of tenure than they would if they were renting. Their role is to take care of buildings on behalf of owners on a temporary basis, so they can be asked to move on with 28 days’ notice. In return, they pay significantly less for their housing.
This means property guardianship doesn’t suit everyone – it isn’t appropriate for people with high support needs, for children or for others who need to rely on a long-term home. We can only house people who are flexible, resilient and able to take a house-move in their stride.
There are many people who would like to save money on housing, so from this huge pool we look for guardians who actively want to volunteer for a charity of their choice, and then support them to do so.
Our experience over the past 12 years has shown how effective this is. Collectively, our guardians have given time worth more than £5.4m since we launched in 2011, the equivalent of one person working full time for more than 238 years. Of this, at least £2.1m of impact can be directly attributed to our work, because reducing our residents’ cost of living while supporting them to find good ways to give their time helps them to do more.
Ensuring business sustainability
We are a social enterprise but we don’t receive government or philanthropic funding – we cover our costs by trading. Most of our income is from the licence fees paid by those we house, so we make sure that this meets or exceeds what it costs to run our organisation. Any surpluses are predominantly reinvested in the business, or used to build reserves to enable us to continue to deliver our service through tough times.
In our view, ensuring business sustainability is part of operating ethically. Scores of property owners depend on us for property security and hundreds of guardians rely on us for their homes, so we need to make sure that our stakeholders can rely on us to deliver in the long run.
This need for resilience means that we usually can’t offer housing for less than 50% of local market rents, because doing so would put our ability to deliver consistently at risk.
Keeping prices fair across our portfolio
Finally, we seek to ensure that everyone we house pays similar amounts for similar housing. In our annual fee reviews, we reduce the amount paid by some guardians, hold prices unchanged for some, and increase costs for others to create a fairer distribution of pricing.
Dot Dot Dot undertakes a licence fee review every twelve months. Broadly, any increases will be based on the rate of inflation at the time of review, but they will also take into account any specific changes in our costs or in the local market. We also look at changes to council tax rates and utilities. Current guardians will be given at least two month’s notice before their licence fees change and new guardians will not face changes for at least six months.
Looking to the future
Given the cost-of-living crisis and the current economic turbulence, the charities our guardians help are needed more than ever and the demand for housing continues to grow, so we are very glad to be able to continue our work to create inexpensive homes for people who want to volunteer. If you know anyone who would benefit from our work, please spread the word.
